A Guide for Companies in the UAE to Adhere to the New Compliance Mandates

A Guide for Companies in the UAE to Adhere to the New Compliance Mandates

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In a recent move that promises greater economic transparency and regulatory integrity, the Ministry of Economy in the UAE has implemented stringent legislation. According to the newly enacted law, all companies operating within the UAE jurisdiction (except entities in ADGM, DIFC, and government sectors) must maintain an extensively updated ‘Corporate Register’.

This development took shape through the Cabinet Resolution No. 109 of 2023 and Cabinet Decision No. 132 of 2023. It marks the commitment of the government to combat financial discrepencies and enhance the business landscape in the country. In this guide, we have explained specific aspects of this mandate. Read on to understand its implications for businesses and actionable steps to ensure seamless compliance, avoiding hefty penalties.

The Corporate Register Requirement for Companies in the UAE

The Corporate Register serves as a foundational repository, carrying details about the organizational framework and governance of an organization. It goes a long way in fostering transparency and helping regulatory bodies and financial institutions carry out thorough due diligence. This significantly bolsters trust within the business environment in the UAE. New businesses must prepare their registers to be inspected within 60 days of their registration date. On the other hand, existing companies have just 30 days upon receipt of circulars regarding new rules to update and prepare their registers.

Each company bears the responsibility of maintaining updated corporate secretarial records, including the time of meetings between the board and shareholders, agendas, and notices. The authorities are likely to verify these records. The relevant licensing authority should be notified about any alterations to these records within 15 days. Besides, companies are required to update these documents on the government portal and submit the revised client documents.

Non-compliance with these mandates carries significant penalties, with fines of up to AED 50,000. Other potential consequences include temporary suspension of the trade license or closure of the business. Moreover, the licensing authority will scrutinize these directives to ensure transparency.

Conclusion

Recent legislative updates in the UAE mark a significant stride for the country to create a more transparent and regulatory corporate environment. While the mission to establish a Corporate Register seems daunting, timely compliance proves essential to meet legal requirements. It also nurtures a commercial environment defined by trust and transparency for businesses.

How Can the IMC Group Help You?

As a trusted advisory partner for businesses in the UAE, the IMC Group comprehensively understands the new challenges you are encountering in adapting to new regulations. Our proactive team of experts specializing in legal matters and compliance issues can assist you in complying with the fresh set of norms. Whether you have an existing company in the UAE and need to update records or have been planning to set up a new business, we can help you ensure meticulous documentation and full compliance with the latest set of laws.

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